On the Speed of Economic Reform - A Tale of the Tortoise and the Hare: Evidence from Transition Countries
AbstractWe analyse how the choice of reform speed, foreign direct investment (FDI) and economic growth affect one another. New reforms affect economic growth negatively, whereas the level of past reform leads to higher growth and attracts FDI. We simulate the impact of big bang and gradualist strategies on economic growth. This is only meaningful in the presence of reform reversals, which requires aggregate uncertainty about the appropriate reform. We find that even relatively small ex ante reversal probabilities suffice to tilt the balance in favour of gradualism. The case for gradualism gains strength if policymakers are short-sighted, but weakens if voters are myopic.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Taylor and Francis Journals in its journal Journal of Economic Policy Reform.
Volume (Year): 10 (2007)
Issue (Month): 1 ()
Contact details of provider:
Web page: http://www.tandfonline.com/GPRE20
Other versions of this item:
- Bruno Merlevede & Koen Schoors, 2007. "On the Speed of Economic Reform - A Tale of the Tortoise and the Hare: Evidence from Transition Countries," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 10(1), pages 29-50.
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Berggren, Niclas & Bergh, Andreas & Bjørnskov, Christian, 2009.
"The growth effects of institutional instability,"
2009:8, Lund University, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.